Iceland may use more electricity mining bitcoin than powering homes this year

The aurora borealis is a visible display of electrically charged atomic particles from the Sun interacting with Earth's magnetic field.Sherwin Calaluan

Iceland will likely use more electricity in the next year to mine bitcoin than it uses to power every single home in the country.

Bitcoin mining is booming in Iceland, and energy providers are worried they won't be able to power new mining companies.

Iceland's cool weather, cheap energy and super-fast networks have made the country a popular home for bitcoin mining.

Members of the government have proposed taxing profits made by bitcoin mining companies.

Iceland may soon use more electricity to mine bitcoin than it uses to power every home, according to an Icelandic energy expert.

The energy used by Iceland's bitcoin mining market is experiencing "exponential growth," and data centers may use more energy than all of the country's homes in 2018, Johann Snorri Sigurbergsson from Icelandic energy company HS Orka told the BBC.

Sigurbergsson also said HR Orka "won't have enough energy" to power numerous new data centers that have been proposed.

Sigurbergsson told the BBC he estimates Iceland's bitcoin mining tools currently use around 840 gigawatt hours of electricity to power computers and cooling systems each year, while most of the country's homes use around 700 gigawatt hours.

Genesis Mining, one of the largest crypto miners in Iceland, has opened three mining facilities in Iceland and in 2016 CEO Marco Streng speculated the company may be one of the biggest single users of power in the country.

The rise of crypto mining in the country has prompted government members to consider steps to tax the industry.

"Under normal circumstances, companies that are creating value in Iceland pay a certain amount of tax to the government," Smari McCarthy, a member of Iceland's Pirate Party, told the Associated Press. "These companies are not doing that, and we might want to ask ourselves whether they should."